8-KMaterial AgreementsFinancial EventsOther Events+1

AGILENT TECHNOLOGIES, INC. 8-K Report, Material Agreement (Sep 14, 2009)

Filed September 14, 2009For Securities:A

Summary

Agilent Technologies, Inc. filed an 8-K on September 14, 2009, to report the entry into a material definitive agreement for the issuance of $750 million in aggregate principal amount of senior notes. This includes $250 million of 4.45% Senior Notes due 2012 and $500 million of 5.50% Senior Notes due 2015. The offering was underwritten by Barclays Capital Inc., Citigroup Global Markets Inc., and Credit Suisse Securities (USA) LLC. In conjunction with the debt offering, Agilent also entered into interest rate swaps designed to convert its fixed-rate interest expense on these notes to a variable LIBOR-based rate. This move suggests a strategic decision to manage interest rate risk and potentially benefit from future declines in LIBOR. The filing details the terms of the notes, including redemption provisions, covenants, and events of default, providing investors with crucial information about the company's financing activities and associated risks.

Key Highlights

  • 1Agilent Technologies issued $750 million in senior notes, comprising $250 million of 4.45% Senior Notes due 2012 and $500 million of 5.50% Senior Notes due 2015.
  • 2The issuance was conducted as an underwritten public offering with major financial institutions including Barclays Capital, Citigroup, and Credit Suisse.
  • 3The company entered into interest rate swaps with a notional amount of $750 million to convert fixed-rate interest obligations to variable LIBOR-based payments.
  • 4The notes are unsecured and rank equally with other senior unsecured indebtedness of Agilent.
  • 5The notes are redeemable at the company's option, with specific redemption price calculations based on present values and applicable Treasury rates.
  • 6A 'Change of Control' event that results in a downgrade of the notes to below investment grade by rating agencies will trigger an offer to repurchase the notes at 101% of their principal amount.
  • 7Customary covenants are in place limiting the company's ability to grant liens and enter into certain sale and lease-back transactions.

Frequently Asked Questions

The primary purpose of this filing is to report Agilent Technologies' entry into a material definitive agreement for the issuance of $750 million in aggregate principal amount of senior notes, consisting of $250 million of 4.45% Senior Notes due 2012 and $500 million of 5.50% Senior Notes due 2015.

Agilent entered into interest rate swaps to convert its fixed-rate interest expense on the newly issued notes to a variable LIBOR-based interest rate. This strategy allows the company to manage its interest rate exposure and potentially benefit from future decreases in LIBOR.

In the event of a Change of Control that leads to a downgrade of the notes to below investment grade by major rating agencies (Fitch, Moody's, S&P), Agilent will be required to make an offer to repurchase the notes at 101% of their principal amount, plus accrued interest.

The notes mature in 2012 and 2015, bear fixed interest rates of 4.45% and 5.50% respectively, are unsecured, and are redeemable at the company's option under specific conditions. The indenture also includes covenants that restrict the company's ability to incur certain types of debt secured by liens and to engage in sale and lease-back transactions.